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What The Marriage Allowance Calculator Works Out
- Result: whether the couple qualifies. The lower earner must have income under the GBP 12,570 personal allowance (so part of it is going spare), the higher earner must be a basic rate taxpayer (income up to GBP 50,270), and you must be married or in a civil partnership, not just living together.
- Tax saving this year: the lower earner transfers GBP 1,260 of personal allowance and the higher earner's tax falls by 20% of that, GBP 252 a year. HMRC estimates hundreds of thousands of eligible couples have never claimed.
- With 4 years backdated: claims can go back four tax years, so a first claim can be worth up to GBP 1,260 including the current year. Past years are paid as a cheque or refund, the current year through a changed tax code, and the claim renews automatically.
- How to claim: free on GOV.UK by the lower earner, a five-minute job needing both National Insurance numbers. Third-party sites charging fees for the same claim are worth avoiding. Cancel on divorce or if incomes rise.
- Lower earner's extra tax (advanced): the transfer is all-or-nothing, so the lower earner's own allowance drops to GBP 11,310. If their income is between GBP 11,310 and GBP 12,570 they start paying 20% tax on the excess, which eats into the GBP 252.
- Net saving for the couple (advanced): the higher earner's saving minus any tax the lower earner now pays. A lower earner on GBP 12,000 costs the couple GBP 138, leaving a net gain of GBP 114 rather than GBP 252.
- Past years to backdate (advanced): choose how many of the last four tax years you were eligible but did not claim; the refund card multiplies the saving by that number.
- Higher earner's pension contributions (advanced): gross personal pension payments reduce the income HMRC tests against the GBP 50,270 basic rate limit, so a higher earner just over the line can still qualify.
- Born before 6 April 1935 (advanced): such couples claim the separate Married Couple's Allowance instead, which is worth more and cannot be combined with marriage allowance.
- Scotland: Scottish taxpayers qualify if the higher earner pays starter, basic or intermediate rate, so the income limit differs slightly.
Source and further reading: GOV.UK (HMRC): Marriage Allowance.